The United States and India moved closer to a trade pact on Friday with an interim framework to cut tariffs, reshape energy ties and deepen economic cooperation as both countries seek to realign global supply chains.
Here are the key points of the joint statement:
WHAT WAS ANNOUNCED
United States and India agree on a framework for an interim reciprocal trade agreement
* Framework tied to broader US-India Bilateral Trade Agreement (BTA) talks launched on Feb 13, 2025
* Deal aims for reciprocal, balanced trade and greater supply chain resilience
INDIA’S TARIFF ACTIONS
* Will eliminate or reduce tariffs on all U.S. industrial goods
* Will cut duties on a wide range of U.S. farm and food products, including DDGs (dried distillers’ grain) and red sorghum for feed, tree nuts and fruits, soybean oil, wine and spirits
* Will provide preferential market access in agreed sectors
U.S. TARIFF ACTIONS
* Will apply an 18% reciprocal tariff rate on Indian-origin goods under existing executive orders
* Tariffs initially cover sectors including textiles and apparel, leather and footwear, plastics and rubber, organic chemicals, home decor and artisanal goods, certain machinery
* Will remove reciprocal tariffs on a wide range of Indian goods after successful conclusion of the interim deal, including generic pharmaceuticals, gems and diamonds, aircraft parts
STEEL, ALUMINIUM, AUTO PARTS
* U.S. to remove certain Section 232 tariffs on Indian aircraft and aircraft parts tied to steel, aluminium and copper measures
* India to receive a preferential tariff-rate quota for auto parts under U.S. national security tariff rules
* Pharmaceutical tariff outcomes remain subject to an ongoing U.S. Section 232 probe
NON-TARIFF BARRIERS
* India to address long-standing barriers affecting U.S. medical devices, ICT goods import licensing, and U.S. food and agricultural products
* India to review acceptance of U.S. or international standards and testing rules within six months in identified sectors
* Both sides to discuss standards and conformity assessment procedures
RULES AND SAFEGUARDS
* Both sides to set rules of origin to ensure benefits primarily go to U.S. and Indian producers
* Either side can modify commitments if the other changes agreed tariffs
DIGITAL TRADE
* Both countries commit to address discriminatory or burdensome digital trade practices
* To work toward digital trade rules under the full BTA
BTA SUPPLY CHAINS AND SECURITY
* Both sides to align on economic security and supply chain resilience
* Cooperation planned on investment reviews, export controls and non-market policies of third countries
INDIA PURCHASE COMMITMENTS
* India intends to purchase $500 billion of U.S. goods over five years, including energy products, aircraft and parts, precious metals, technology products and coking coal
* Both sides to expand technology trade, including Graphics Processing Units (GPUs) and data centre equipment
NEXT STEPS
* Framework to be implemented promptly
* Countries to finalise the interim agreement while continuing negotiations toward a full bilateral trade agreement.
